Starrys Obazei/December 14, 2022.
Lagos-based naturally vibrant and celebrated Senior Advocate of Nigeria, Femi Falana in a statement entitled, ‘Maximum withdrawal limit in Nigeria is N5m’ has called on the President, Major General Muhammadu Buhari, (retd.), to direct the apex bank to withdraw the ‘illegal guideline’.
According to him: “It is embarrassing that the Central Bank of Nigeria has been making announcements without any regard to the Constitution and other relevant laws on the national economy.
“It is particularly worrisome that the Governor of the Central Bank of Nigeria has purportedly limited cash withdrawals in Nigeria in complete defiance of section 2 of the Money Laundering Act, 2022 which provides as follows:
“No person or body corporate shall, except in a transaction through a financial institution, make or accept cash payment of a sum exceeding (a)5,000,000 or its equivalent, in the case of an individual; or (b) N10,000,000 or its equivalent, in the case of a body corporate.
“A person shall not conduct two or more transactions separately with one or more financial institutions or designated non-financial businesses and professions with intent to (a) avoid the duty to report a transaction which should be reported under this Act, and (b) breach the duty to disclose information under this act by any other means.
“Since the Money Laundering Act 2022 (which has fixed maximum cash withdrawal to N5 million) has not been amended, the limitation of cash withdrawal of not more than N20,000 per day and N100,000 per week fixed by the Central Bank of Nigeria is illegal, null and void in every material. We urge the Nigerian people to ignore the illegal announcement.
“However, we are compelled to call on President Muhammadu Buhari to direct the management of the CBN to withdraw the illegal guideline and stop announcing more policies that are designed to sentence poor citizens to more excruciating economic hardship”
With the above understanding, Point of Sale (PoS) terminal operators and Femi Falana, have said they will sue the Central Bank of Nigeria if it fails to withdraw the new cash withdrawal policy limiting over-the-counter cash withdrawals by individuals and companies to N100,000 and N500,000, respectively, per week.
The CBN had, in the memo introducing the policy, said third-party cheques above N50,000 would no longer be eligible for OTC payment while extant limits of N10 million on clearing cheques remained.
The circular also directed banks to load only N200 and lower denominations into their ATMs and restricted withdrawal to N20, 000 per day from ATMs. Withdrawals from PoS terminals were also limited to N20,000 daily.
The policy, which will become effective on January 9, 2023, had generated criticisms but the CBN clarified last Wednesday that PoS operators could apply for waivers.
However, Falana, on Monday, described the new cash withdrawal limit policy initiated by the CBN as unconstitutional.
As a result, he said he would go ahead to sue the apex bank if its management failed to withdraw the new policy.
Impact on small businesses
However, the legal luminary noted the impact of the policy on market men and women.
He said: “I read in The PUNCH newspapers of the number of PoS businesses that will be affected. Take a look at the effect on market women and others who sell wares. How many of them have PoS machines? How many of them will be willing to engage in bank transfers? Last week, I, despite being someone familiar with smartphones, made a cash transfer to someone, but the person called to tell me that he has not received the amount I sent.”
When asked if he would sue the CBN or the Federal Government over the policy, Falana said: “We have not got to that stage yet. I want them to reply to me first. Tell them I said it is not constitutional. If they fail to withdraw the order, then we will sue, that I can assure you.”
Gbajabiamila kicks
Meanwhile, the Speaker of the House of Representatives, Femi Gbajabiamila, has, again, criticized the controversial policy recently introduced by the Central Bank of Nigeria, which, among others, sets limits to cash withdrawals at deposit money banks and other financial institutions.
The House had, last Thursday, asked the CBN to suspend the policy’s launch until the lawmakers concluded their investigations.
The House had consequently summoned the Governor of the CBN, Godwin Emefiele, to come and explain the policy to the parliament. He is to appear before the lawmakers on Thursday.
Gbajabiamila expressed his views in his address at the second edition of the Distinguished Parliamentarians Lecture Series held in Abuja on Monday and organized by the National Institute for Legislative and Democratic Studies.
Gbajabiamila said: “Recently, the Central Bank of Nigeria announced a policy to redesign the Nigerian Naira and impose restrictions on cash transactions across the economy. The National Assembly has been inundated with petitions from citizens worried about the impact of the new policies on their businesses and concerned that the policy approach will not deliver its stated policy objectives.
Many have pointed to the fact that in India where a similar policy was implemented beginning in 2016, the expected benefits haven’t materialized, yet there has been a pronounced contraction in the economy probably linked to the policy.
“Now, whatever the concerns about the policy may be, it should not be the normal course of things for such a profoundly impactful policy program to be designed, approved, and announced without any engagement with the legislature, or any attempt to seek the perspectives of the people’s representatives. Keep in mind, these are the very same people who will have to explain and answer for these policies in communities across the country
I don’t think the title of your article matches the content lol. Just kidding, mainly because I had some doubts after reading the article.